Copley and Copley

FAMILY COURT OF AUSTRALIA

COPLEY & COPLEY

[2010] FamCA 1023

FAMILY LAW – SPOUSAL MAINTENANCE – where the husband makes an application for urgent or interim spousal maintenance – whether the husband is unable to support himself – whether the wife is reasonably able to maintain the husband – held that wife is unable to reasonably maintain the husband having regard to matters set out in s 75(2) – husband’s application dismissed
FAMILY LAW – PROPERTY – where the wife seeks the sale of the former matrimonial home to meet the parties’ outstanding debts – where the parties’ superfund may not be compliant and may be subject to penalty – where the parties owe significant debt to the bank – where the parties have no other means of meeting payment – just and equitable – orders that the former matrimonial home be sold and funds used to meet mortgage debts

Family Law Act 1975 (Cth) ss 72, 74(1), 75, 77, 79 & 80

Hayson & Hayson (1987) FLC 91-819

APPLICANT:

Mr Copley

RESPONDENT:

Ms Copley

FILE NUMBER:

ADC

551

2010

DATE DELIVERED:

17 November 2010

PLACE DELIVERED:

Adelaide

PLACE HEARD:

Adelaide

JUDGMENT OF:

Dawe J

HEARING DATE:

23 September 2010

REPRESENTATION

COUNSEL FOR THE APPLICANT:

MRS READ

SOLICITOR FOR THE APPLICANT:

BRONWYN ZANKER & CO LAWYERS

COUNSEL FOR THE RESPONDENT:

MR RICHARDS

SOLICITOR FOR THE RESPONDENT:

ROBINSON & MASON

Orders

The husband’s applications for urgent and interim spousal maintenance are dismissed.
The former matrimonial home situated at M be immediately placed on the market for sale upon the following terms:
(a)an agent be agreed as between the parties and in default of agreement as ordered by the Court;
(b)the sale price be as recommended by the land agent so appointed;
(c)the net proceeds of sale after payment of agents fees and disbursements and other outgoings (including the discharge of the mortgages registered over the property) be held in trust in an interest bearing account in the names of the parties’ solicitors pending finalisation of the property settlement proceedings PROVIDED THAT if the sum of $209,000 is recommended by the parties’ accountants to be repaid to the Copley Superannuation Fund then such payment be made forthwith from the proceeds of sale.
Liberty to apply for consequential orders.

IT IS NOTED that publication of this judgment under the pseudonym Copley & Copley is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT ADELAIDE

FILE NUMBER: ADC 551 of 2010

MR COPLEY

Applicant

And

MS COPLEY

Respondent

REASONS FOR JUDGMENT

Introduction

Proceedings seeking final orders by way of settlement of property were commenced by the wife Ms Copley by Initiating Application filed on 15 February 2010. In that Initiating Application she sought certain interim orders which included orders seeking the sale of the former matrimonial home at M and for the net proceeds of sale after payment of agents fees and disbursements to be used to discharge the mortgage registered over the title with the balance to be held in trust pending finalisation of the property settlement proceedings.
By Response to the Initiating Application filed by the husband Mr Copley on 27 April 2010 he also sought specific final orders for property settlement and interim orders including that the wife pay the sum of $708 per week for his maintenance, that the application for maintenance be listed as a matter of urgency, that the wife make minimum monthly payments to repay the “Westpac Home Loan and Joint Investment Loan and [the wife’s] Investment Loan” until final settlement, or that the wife pay the husband an “additional amount of $1,336 per week in maintenance to enable him to pay the Westpac Home Loan and the Investment Loan in joint names”. (Document 5).
On 7 June 2010 the proceedings were transferred from the Federal Magistrates Court to the Family Court of Australia.
Following listings of the matter before a Registrar of this Court and another Judge of this Court, the matter was listed for interim hearing on the papers before me on 23 September 2010.
At the hearing before me on 23 September 2010 the wife was represented by Mr Richards of counsel and the husband by Mrs Read of counsel.
On that day the matter was heard with both parties relying on affidavits already filed in the proceedings. There was no oral evidence or cross-examination. The Court received an exhibit.
When the matter was again listed before me on 4 November 2010 the Court received Exhibit 2 a letter from Westpac in relation to the mortgage registered on the former matrimonial home.

Relevant background and chronology

The wife was born in 1966 and is aged 44 years. The husband was born in 1964 and is aged 46 years. The parties married in 1989 and separated on 24 January 2009.
There are two children of the marriage, L who was born in April 1995 (15 years) and P who was born in November 1997 (13 years). The children live with the wife.
Apart from a short time when the wife was not working, but was receiving maternity leave connected with the birth of both children, the wife has been in employment throughout the marriage. For most of the marriage she has worked for A Pty Ltd and is now the General Manager. There is a dispute about the availability of an option to purchase an interest in the business or company.
The husband is a qualified engineer and project manager. He has not worked since late 1997/early 1998. At the time he ceased work he said he was earning approximately $60,000 per annum.
On the affidavits filed there is a dispute about the reason the husband ceased his employment.
Since May 2009 the husband has been receiving treatment and medication from Dr C, a psychiatrist.
The husband refers in his affidavit to damaging his right knee approximately five years ago. He asserts that this will make finding manual work difficult. The husband refers to applying for three jobs earlier in the year, but not being successful.
After the separation the husband lived for a short time in rented accommodation with the rent paid by the wife. For that period the wife lived in the former matrimonial home. The wife moved out of the former matrimonial home and the husband has been residing in the former matrimonial home since 15 August 2009.
The wife maintains that since August 2009 the husband has been occupying the former matrimonial home but has not made any payments in relation to either of the Westpac Bank Mortgages, nor the outgoings such as rates and taxes for the property.
The former matrimonial home situated at M was originally estimated by the wife to be worth approximately $800,000, but in her affidavit filed on 13 September 2010 and Financial Statement filed on 13 September 2010, she estimates the value to be $750,000. The husband does not agree with this estimate and says it is worth approximately $720,000. The former matrimonial home is subject to a mortgage to Westpac Banking Corporation securing the repayment of loans. The wife made payments in relation to the Westpac Loans until September 2009.
In approximately January 2010 the wife made arrangements with Westpac (agreed to by the husband) which put the mortgage payments on hold for a period of six months.
In the wife’s affidavit filed on 13 September 2010 the wife referred to the debts to Westpac as follows:
(1)      Westpac Equity Investment Loan (in joint names)  $463,533.00
(2)      Westpac Rocket Investment Loan for Timbercorp Shares           $36,054.00
(3)      Westpac Home Loan  $17,657.00
Total:  $517,244.00
Following the separation the wife borrowed monies from the Commonwealth Bank to purchase a property at H, which cost $740,000. Her Financial Statement shows that she owes the bank $607,000 for this property. The wife also owes money to her employer (approximately $200,000).
There is a substantial dispute between the parties as to the existence, and if it exists, value of, the wife’s interest in her employer’s business. The husband maintains that the wife has “prospective entitlements in [E Pty Ltd] and/or [A Pty Ltd] worth over E2 Million Dollars” (See paragraph 12 of the husband’s affidavit filed on 20 September 2010). The wife denies that she has any interest of significant value.
There is also a dispute about the sum of $209,000 being repayable to the superannuation fund.
The wife maintains that an amount of $209,000 was removed from the Super Fund bank account and used to purchase shares in the joint names of the parties. These funds were drawn from the Copley Super Fund on various dates ranging from 9 January 2008 to 18 November 2008. Annexure “A” to the wife’s affidavit filed on 13 September 2010 is a letter from L Accountants dated 9 July 2010 which includes, inter alia, “The amount of $209,000 has to be paid back to the superfund as soon as possible in order for the superfund to remain a complying Super Fund”. The letter then refers to the consequences of failure to repay the monies which penalties include that this will render the Super Fund non-complying, the assets of the trust can be frozen and the trustees prosecuted.
The wife asks that orders provide that this sum be paid from any proceeds of sale of the former matrimonial home after the discharge of the mortgage debts.
The husband admits that he was aware of the information from the accountants suggesting that the sum of $209,000 should be repaid to the Super Fund, but suggested in his affidavit that “the amounts may be written off rather than repaid”. (Paragraph 6 and 10 of the affidavit of the husband filed on 20 September 2010).
Exhibit 1 is the Macquarie Visa Platinum Credit Card Statements of the husband. Some items were highlighted including monies the husband had spent at restaurants, hotels and for travelling to holiday destinations in South Australia and interstate tourist destinations.
When the matter was before the Court on 4 November 2010 a letter from the Westpac Group dated 25 October 2010 was received as Exhibit 2. This letter addressed to the husband is from the Collection Department for the Westpac Banking Corporation and is a Default Notice. It refers to the mortgage being in arrears of $8,017.05 and that the full account balance of $466,724.05 was then owing.

The Law

Section 72 of the Family Law Act 1975 (Cth) (“the Act”) provides:
Right of spouse to maintenance
Section 72
(1)A party to a marriage is liable to maintain the other party, to the extent that the first‑mentioned party is reasonably able to do so, if, and only if, that other party is unable to support herself or himself adequately whether:
(a)by reason of having the care and control of a child of the marriage who has not attained the age of 18 years;
(b)by reason of age or physical or mental incapacity for appropriate gainful employment; or
(c) for any other adequate reason;
having regard to any relevant matter referred to in subsection 75(2).
Section 74(1) says:
Power of court in spousal maintenance proceedings
(1) In proceedings with respect to the maintenance of a party to a marriage, the court may make such order as it considers proper for the provision of maintenance in accordance with this Part.
Section 75 provides:
Matters to be taken into consideration in relation to spousal maintenance
(1) In exercising jurisdiction under section 74, the court shall take into account only the matters referred to in subsection (2).
(2) The matters to be taken into account are:
(a)the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment; and
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years; and
(d)commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain; and
(e)the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates, within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party;
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable; and
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income; and
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant; and
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party; and
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration; and
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i)the property of the parties; or
(ii)vested bankruptcy property in relation to a bankrupt party; and
(naa) the terms of any order of declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i)a party to the marriage; or
(ii)a person who is a party to a de facto relationship with a party to the marriage; or
(iii)the property of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage,
(3) In exercising its jurisdiction under section 74, a court shall disregard any entitlement of the party whose maintenance is under consideration to an income tested pension, allowance or benefit.
(4) In this section:
party means a party to the marriage concerned.
Section 79 provides:
Alteration of property interests
(1)In property settlement proceedings, the court may make such order as it considers appropriate:
(a)in the case of proceedings with respect to the property of the parties to the marriage or either of them--altering the interests of the parties to the marriage in the property;
…
(2)The court shall not make an order under this section unless it is satisfied that, in all the circumstances, it is just and equitable to make the order.
(4)In considering what order (if any) should be made under this section in property settlement proceedings, the court shall take into account:
(a)the financial contribution made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(b)the contribution (other than a financial contribution) made directly or indirectly by or on behalf of a party to the marriage or a child of the marriage to the acquisition, conservation or improvement of any of the property of the parties to the marriage or either of them, or otherwise in relation to any of that last‑mentioned property, whether or not that last‑mentioned property has, since the making of the contribution, ceased to be the property of the parties to the marriage or either of them; and
(c)the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of homemaker or parent; and
(d)the effect of any proposed order upon the earning capacity of either party to the marriage; and
(e)the matters referred to in subsection 75(2) so far as they are relevant; and
(f)any other order made under this Act affecting a party to the marriage or a child of the marriage; and
(g)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage.
Section 80 provides:
General powers of court
(1)The court, in exercising its powers under this Part, may do any or all of the following:
…
(h)make a permanent order, an order pending the disposal of proceedings or an order for a fixed term or for a life or during joint lives or until further order;
…
(k)make any other order (whether or not of the same nature as those mentioned in the preceding paragraphs of this section), which it thinks it is necessary to make to do justice; and
(l)subject to this Act and the applicable Rules of Court, make an order under this Part at any time before or after the making of a decree under another Part.
When the husband lodged his application for spouse maintenance in the Response to his Initiating Application filed on 27 April 2010 there was no specific reference to the provisions of section 77. His application sought maintenance in the sum of $708 per week and an order that the wife pay $1,336 per week to enable him to pay the Westpac Home Loan and Investment Loan in joint names. (Paragraphs 1 and 5 of the interim orders in the Response to an Initiating Application – document 5). Paragraph 2 of that application said:
“2.That the application in paragraph 1 above be listed as a matter of urgency.”
Section 77 of the Act provides:
Urgent spousal maintenance cases
Where, in proceedings with respect to the maintenance of a party to a marriage, it appears to the court that the party is in immediate need of financial assistance, but it is not practicable in the circumstances to determine immediately what order, if any, should be made, the court may order the payment, pending the disposal of the proceedings, of such periodic sum or other sums as the court considers reasonable.
Section 80 of the Act gives the Court wide powers including a power to make an order pending the disposal of proceedings and impose terms and conditions.
In the Full Court decision of Hayson & Hayson (1987) FLC 91-819 the following passage appeared after the reference to section 77:
“This provision and the distinction between it and an interim maintenance proceeding under section 80 and a permanent maintenance proceeding under sections 72 and 74 have been the subject of a number of decisions in this Court. In this regard reference need only be made to cases such as Malcolm (1977) FLC 90-220, Williamson (1978) FLC 90-505, and Chapman (1979) FLC 90-671. Those cases demonstrate that the section relates to "relief of immediate needs", "present pressing needs", that the order is intended to be "in the nature of a stop-gap order", and is intended to "deal with urgent situations".”

Discussion

If the matter is treated as an application for urgent spousal maintenance under section 77 of the Act, the Court is required to consider if “it appears” that the husband is in immediate need of financial assistance, but it is not practicable in the circumstances to determine immediately what order, if any, should be made. If those conditions are met the Court has a discretion pending the disposal of the proceedings to order the payment of such sum or sums as the Court considers reasonable.
The Court has before it considerable amount of information from both parties, however, on either an urgent or interim basis, it is not possible to determine all of the issues in dispute between the parties. When considering the application by way of an interim maintenance pursuant to section 80, it is necessary to consider the principles which apply to any maintenance application.
In this matter it is more appropriate to consider the provisions of sections 74 and 75.
In any event if the Court is asked to make a maintenance order, whether pursuant to section 77 or section 74, the principles of section 72 are relevant; namely that the husband is unable to support himself, and if so, the extent to which the wife is reasonably able to maintain the husband having regard to the matters in section 75(2).

Section 75(2) factors

The husband does not have the care and control of children of the marriage. The husband is aged 46 years.
The question of the husband’s physical or mental incapacity for appropriate gainful employment is one of the issues to be determined having regard to the matters referred to in section 75(2).
The wife takes issue with his claims to be unable to find work. In paragraph 41 of the wife’s affidavit filed on 17 May 2010 (document 10) she refers to his activities with two sporting groups, his “dating website profile” and “Facebook” information which refers to his sports and physical activities, together with his travels around Australia since the separation.
It is also necessary to consider the wife’s ability to maintain the husband if he otherwise satisfies the criteria.
(a) the age and state of health of each of the parties; and
(b)the income, property and financial resources of each of the parties and the physical and mental capacity of each of them for appropriate gainful employment;
The wife is aged 44, the husband is aged 46.
The wife is in good health.
The husband sought to rely upon a report from his psychiatrist dated 16 February 2010. That report refers to a diagnosis of the husband suffering from major depression with anxiety and relationship problems.
Under the heading “Our client’s general vocational aptitude” it states:
“I am not an expert in occupational medicine and recommend that you seek an opinion regarding [the husband’s] general vocational aptitude from an occupational physician. In my opinion his depression and anxiety at the last interview on the 11^th February 2010 were not of sufficient severity to prevent him from continuing in his usual work of share trading, but were of sufficient severity to prevent him from seeking employment in other areas.”
In his affidavit sworn on 13 September 2010 and filed on that date, the husband refers to not having worked for 12 years in the field as a professional engineer, but also refers to having applied for three jobs “recently” but not being successful. He refers to continuing his investment work but says that without capital he cannot profit from this. (Paragraph 16 of his affidavit filed on 13 September 2010). The husband also refers to having damaged his knee five years ago and that this would make it difficult for him to undertake manual work.
The wife draws the Court’s attention to the husband’s recent activities helping to build a trailer and being involved as a duty instructor for a performance coaching week held at the Sporting Club. She maintains that the husband is a qualified engineer. She does not accept that he would be unable to obtain employment.
In paragraph 37 of the wife’s affidavit filed on 15 February 2010 the wife says:
“The husband has been carrying out physical activity helping to build a [sports equipment] trailer and also involved in share trading which would indicate the ability to work in some sort of employment.”
It is maintained on behalf of the wife that the husband has not justified his failure to undertake some form of paid employment or to do so in the future.
There are substantial issues between the parties concerning the identification and value of property and financial resources. In particular the Court is not able to determine the claim by the husband that the wife has an entitlement to an option or substantial interest in her employer’s company or business.
The assets include the former matrimonial home at M. The wife has now acquired a property at H. Both properties are subject to significant mortgages to the Westpac Banking Corporation and to the Commonwealth Bank.
Both parties have in their possession various personal items, furniture and vehicles. The company known as SA Pty Ltd owns the sports equipment worth approximately $220,000, which has been on the market for sale for some time.
(c)whether either party has the care or control of a child of the marriage who has not attained the age of 18 years;
The wife has maintained and continues to maintain the two infant children of the marriage, aged 15 and aged 12.
(d)commitments of each of the parties that are necessary to enable the party to support:
(i)himself or herself; and
(ii)a child or another person that the party has a duty to maintain
Neither party has duty to maintain any other person besides the parties to the marriage and their two children.
The husband filed a Financial Statement on 27 April 2010. In that document he said that his personal expenditure was $35 per week for rates, unit levies; estimated $2 a week for Emergency Services Levy; $21 a week for house and contents insurance; $14 per week for motor vehicle registration for the Land Cruiser and other expenditure totalling $613. His total personal expenditure was $685 per week. However, Part N of that document set out his average weekly expenses totalling $708 per week. This included children’s activities at $100 per week; medical, dental and optical (not including health insurance premium) $60 per week; entertainment/hobbies $60 per week; gardening/ lawnmowing $25 per week and cleaning (house/pool) $25 per week.
In his affidavit filed on 18 June 2010 paragraph 142 set out items under the heading “I make an urgent application for spouse maintenance: I require payment as follows:” There was then a list of items which the husband said totalled an estimated $1,336 per week, including similar items to that of his Financial Statement filed in April 2010, but adding in other items and in particular at item 4 “Investment Loan $553 per week”.
The wife filed a Financial Statement on 13 September 2010. That discloses her income as a General Manager of an estimated $4,365 per week, together with benefits from her employment including the use of a car, internet, laptop computer and mobile telephone estimated at $124 per week. The wife then includes under “personal expenditure” total items of $4,952 per week including income tax of $1,547; mortgage payments on the Commonwealth Bank loan in relation to the H property of $1,068 per week; council rates of $75 per week; health insurance of $70 per week; home and contents and rural insurance totalling $51 per week; loan repayments to E Pty Ltd and American Express of an estimated $350 per week and the husband’s medical expenses of $20 per week.
Also included in the total personal expenditure is the figure of $1,738 per week taken from Part N. Included in Part N are: food and household supplies for herself and the two children of a total of $550 per week; entertainment/hobbies $270 per week; holidays $110 per week and gardening/lawnmowing $70 per week.
As is apparent from the Financial Statement the wife asserts that her expenses exceeds her income by approximately $460 per week. Even if some of the larger items in Part N (such as food and household supplies, entertainment, hobbies and holidays) were considered to be extravagant and only allowed at reduced figures, on an interim basis the wife’s commitments would still be substantially more than or at least equal to her current income.
(e) the responsibilities of either party to support any other person; and
(f)subject to subsection (3), the eligibility of either party for a pension, allowance or benefit under:
(i)any law of the Commonwealth, of a State or Territory or of another country; or
(ii)any superannuation fund or scheme, whether the fund or scheme was established, or operates within or outside Australia;
and the rate of any such pension, allowance or benefit being paid to either party;
Neither party has the responsibility to support any other person. The husband’s eligibility for sickness and disability pension has not been the subject of appropriate evidence. The question of the status of the superannuation fund and possible monies owing to the fund make it inappropriate to rely upon any possible superannuation being paid to the husband at this interim stage.
(g)where the parties have separated or divorced, a standard of living that in all the circumstances is reasonable;
This factor should be taken into account when assessing the expenditure of the wife for herself and the children. At the same time the needs of the husband should also be assessed on the basis that it appears that the lifestyle of the parties before separation was certainly above average.
(h)the extent to which the payment of maintenance to the party whose maintenance is under consideration would increase the earning capacity of that party by enabling that party to undertake a course of education or training or to establish himself or herself in a business or otherwise to obtain an adequate income;
The husband has not indicated any proposal immediately to return to education. Payment of maintenance is not sought to enable him to establish a business or obtain an adequate income. He has referred to his inability to trade because of the lack of substantial capital sums but this would not be overcome by the payment of regular maintenance for his support.
(ha)the effect of any proposed order on the ability of a creditor of a party to recover the creditor’s debt, so far as that effect is relevant;
Not relevant.
(j)the extent to which the party whose maintenance is under consideration has contributed to the income, earning capacity, property and financial resources of the other party;
Whilst this factor may be relevant in the overall property settlement proceedings, it is currently not a significant factor in determining what order should be made for either urgent maintenance or interim maintenance.
(k)the duration of the marriage and the extent to which it has affected the earning capacity of the party whose maintenance is under consideration;
The parties were married in 1989 and separated in January 2009. There is a dispute about the background to the husband ceasing to work as an engineer and whether he gave up that career in order to care for the children or in order to trade in shares.
(l)the need to protect a party who wishes to continue that party's role as a parent; and
(m)if either party is cohabiting with another person--the financial circumstances relating to the cohabitation; and
(n)the terms of any order made or proposed to be made under section 79 in relation to:
(i)the property of the parties; or
(ii) vested bankruptcy property in relation to a bankrupt party; and
(naa) the terms of any order of declaration made, or proposed to be made, under Part VIIIAB in relation to:
(i) a party to the marriage; or
(ii)a person who is a party to a de facto relationship with a party to the marriage; or
(iii)the property of a person covered by subparagraph (ii), or of either of them; or
(iv)vested bankruptcy property in relation to a person covered by subparagraph (i) or (ii); and
(na)any child support under the Child Support (Assessment) Act 1989 that a party to the marriage has provided, is to provide, or might be liable to provide in the future, for a child of the marriage; and
(p)the terms of any financial agreement that is binding on the parties to the marriage; and
(q) the terms of any Part VIIIAB financial agreement that is binding on a party to the marriage;
These criteria are not relevant to this application.
(o)any fact or circumstance which, in the opinion of the court, the justice of the case requires to be taken into account;
The husband maintains that he has been living off his credit cards. The wife has an application for the sale of the former matrimonial home, which would require the husband to find other accommodation, but at the same time significantly reducing the liabilities of the parties in particular to the Westpac Bank.

Conclusion on spousal maintenance

Having considered the evidence in the context of urgent or interim maintenance and bearing in mind that it is an assessment of the available evidence only on an interim basis:
(i)although there are contradictions in the evidence the husband has provided some indications that he is currently unable to support himself adequately because of his mental incapacity for employment other than share trading and his inability to share trade brought about by his alleged failure to have access to sufficient capital;
(ii)the wife is not reasonably able to maintain the husband having regard to the matters set out in section 75(2) in particular her need to provide for the care of the two children of the marriage, the commitments necessary to support herself and the two children and the standard of living which in all the circumstances is reasonable.
The husband’s application for interim spousal maintenance or urgent spousal maintenance is therefore dismissed.

Wife’s application for sale of former matrimonial home

In the affidavit filed by the wife on 15 February 2010 she refers to arrangements which were made with Westpac at that time putting the mortgage payments “on hold for a period of six months”.
The wife paid the mortgage payments for some time after the separation, but as at November 2009 the Premium Option Home Loan was in arrears of approximately $4,000 and the Westpac Rocket Equity Investment Loan (in relation to the share investments) was in arrears of some $350. (Paragraph 21 of the wife’s affidavit filed on 15 February 2010 – document 2).
The husband had moved out of the former matrimonial home in late January 2009. He moved to rented premises in M for the period from late January 2009 to the middle of August 2009. During that time the wife paid his rent.
The husband alleged that the wife had agreed to pay the mortgage and other costs on the former matrimonial home until property settlement. The wife denies this.
As previously indicated there is a substantial dispute about the existence of and value of the wife’s interest, if any, in her employer’s business. The husband maintains that if he is successful in establishing that the wife has this significant asset he will be able to retain the former matrimonial home. The wife disputes this and says that on her calculations of the assets and liabilities of the parties the husband would be unable to retain the former matrimonial home.
These significant matters of dispute require the testing of the relevant evidence and are not capable of being decided on the documents before the Court at an interim hearing.
As the Court has found in relation to the husband’s application for spouse maintenance the wife does not have the capacity to make interim payments of maintenance nor the payments of the outstanding mortgages on the former matrimonial home.
The wife also asserts that there is some urgency in the repayment of the sum of $209,000 to the Copley Superannuation Fund. As previously indicated there is a dispute about whether this is a necessary immediate repayment or whether other arrangements can be made. On the evidence currently before the Court it would appear that the information and advice given to the parties is that the sum of $209,000 should be repaid to ensure that the Copley Superannuation Fund does not become “non-compliant” or incur substantial penalties and possibly result in criminal proceedings. If the sum of $209,000 is immediately payable then the sale of the former matrimonial home is likely to raise only sufficient funds to meet the Westpac mortgages and some of the $209,000 owing to the superannuation fund.
Exhibit 2 provided on 4 November 2010 (a letter of 25 October 2010 from the Westpac Group to the husband) confirms that Westpac gave Notice of Default in relation to the large mortgage ($466,724.05) and indicated that the “lender will begin enforcement proceedings against you and will exercise a power of sale in respect of the mortgage property to recover the full account balance”.
The provisions of section 80 of the Act allow the Court to make interim orders. In property settlement proceedings it is necessary to consider the provisions of section 79 and in particular section 79(4). The Court therefore takes into account the financial contributions and non-financial contributions made by each of the parties. The Court has already given consideration to the factors in relation to section 75(2) in the part of the judgment referring to spouse maintenance. The factors considered under section 75(2) indicate that the wife has a substantial earning capacity, but also has significant expenses. The husband asserts that he currently does not have the capacity to support himself and therefore it is implied that he does not have the capacity to maintain the mortgage payments and outgoings in relation to the former matrimonial home.
The other provisions of section 79 are not particularly relevant to this interim application.
The disadvantages of possible ongoing default penalties and mortgagee sale costs support an interim order which would provide for the sale by the husband and wife of the former matrimonial home in order to discharge the mortgages. This would also enable the parties to set aside the necessary funds to repay the Copley Superannuation Fund monies if required to prevent the fund becoming non-compliant.
Having previously considered the factors under section 75(2) that are relevant to these interim proceedings I am satisfied that in all the circumstances of these interim proceedings it is just and equitable to make an order requiring the sale of the former matrimonial home, the discharge of the Westpac mortgages and the setting aside of a sum to repay the Copley Superannuation Fund, if necessary, or otherwise to be held in trust pending the final determination of the final property settlement proceedings.
At the final hearing (after the Court has heard the evidence and determined the facts) appropriate adjustments may be made by way of final property settlement orders which will take into account the orders made today and their effect on the finances of each of the parties.

I certify that the preceding eighty six (86) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Dawe delivered on 17 November 2010.

Associate:

Date: 17 November 2010

[2010] FamCA 1023

17 November 2010

Key Legal Topics

Areas of Law

Family Law

Equity & Trusts

Legal Concepts

Injunction

Remedies

Costs

Jurisdiction